Industrial tenants and developers are increasingly looking to the Tejon Ranch Commerce Center as a strategic alternative to the land-constrained and high-cost Los Angeles industrial market. Santa Monica-based Dedeaux Properties has entered a direct partnership with Tejon Ranch Co. to develop a 510,000-square-foot facility, marking a shift toward speculative development in a region that already hosts major tenants like Ikea and Nestlé USA.
Why industrial developers are moving north
Rising costs and a scarcity of large, empty warehouses in the Los Angeles area are driving industrial users to seek space elsewhere, according to Rishi Thakkar, senior director of investments at Dedeaux Properties. The Tejon Ranch Commerce Center, located at the intersection of Interstate 5 and Highway 99, offers nearly 1,500 acres of space. Jay Cuccia, an executive vice president at Jones Lang LaSalle Inc. (JLL), noted that the site provides access to 54 million people within a single day’s truck drive, making it a competitive choice for distribution.
Did You Know? The Tejon Ranch Commerce Center holds a Foreign Trade Zone designation, which allows tenants to defer, reduce, or eliminate customs duties on imported goods without the lengthy application process often required for industrial assets in the Inland Empire.
Comparing Tejon Ranch and the Inland Empire
While the Inland Empire remains a primary hub with a “mega industrial presence,” industry observers are noting distinct differences between the two regions. According to Cuccia, Tejon Ranch serves larger credit users with complex distribution models and offers rents often 50% lower than those found in Los Angeles. While both regions are roughly equidistant from major ports, Tejon Ranch provides superior access to Northern California and markets as far north as Seattle.
Expert Insight: The transition toward Tejon Ranch reflects a broader trend of industrial decentralization in California. By moving beyond the saturated Inland Empire, developers are betting that the efficiency of pre-entitled, shovel-ready land will outweigh the logistical challenges of shifting distribution patterns further north.
What happens next for the commerce center
Developers expect consistent production of new industrial space at the site over the next few years. Dedeaux Properties and Tejon Ranch Co. are currently working on a 24.6-acre project slated for completion in 2027, which will feature 100 dock-high doors and 185-foot cross-dock truck courts. With 11 million square feet of industrial space still available for development, Tejon Ranch leadership plans to continue seeking partners to build out the remaining acreage.
Frequently Asked Questions
Who is the general contractor for the new development at Tejon Ranch?
Fullmer Construction is the general contractor for the 510,000-square-foot facility currently under construction.
What is the primary advantage of the Tejon Ranch location compared to Los Angeles?
According to Jay Cuccia of JLL, the location offers a “cheap” alternative to Los Angeles with rents often 50% less, as well as expedited building delivery due to the site being pre-entitled.
Which major companies currently occupy space at the Commerce Center?
Existing tenants include Ikea, Nestlé USA, L’Oréal, Caterpillar, Dollar General, Camping World, and Famous Footwear.
Are you seeing similar shifts in industrial real estate demand in your own region?